I think what the original post is talking about is the difference between the small business owner and the entrepreneur.
Joseph Schumpeter defined entrepreneurship:
to reform or revolutionize the pattern of production by exploiting an invention or, more generally, an untried technological possibility for producing a new commodity or producing an old one in a new way, by opening up anew source of supply of materials or a new outlet for products . . . . Entrepreneurship, as defined, essentially consists in doing things that are not generally done in the ordinary course of business routine.
In casual conversation, the terms “small business owner” and “entrepreneur” are often used as if they were the same thing. According to the more narrow definition put forward by Schumpeter, they are something quite different.
The entrepreneur is seeking to disrupt the ordinary way of doing things through innovation, technology, new combinations of assets and new ways of doing business. This is a risky undertaking and therefore the business must scale to generate the returns necessary to justify the risk. These are the opportunities that attract venture capital because of the size of the potential market and the speed at which the business will scale up.
Small business owners start businesses to satisfy a variety of personal and financial goals. They are generally not willing to take on the same level of risk as the entrepreneur so they follow more traditional business models. Franchises are popular partly because they are a proven model which helps reduce risk.
Society needs both small business owners and entrepreneurs. One isn’t better than another. I think it is important to understand the difference because each path has different challenges.